Rx for Health Insurance

Imagine for a moment that you're a pastry chef looking for work. What are your chances of finding a job? If Congress passes a bill requiring employers to pay for health insurance, your chances could be slim. Economists warn that employer mandates will devour millions of jobs. The industries hardest hit will be retail and food services—industries with low profit margins and large numbers of workers—which are affected most when the cost of labor goes up. And driving up the cost of labor is exactly what employer mandates will do. You see, if you're that pastry chef and you're looking for a job with Acme Baking Company, Mr. Acme has to figure out whether he can afford you. That doesn't mean calculating just your salary. Mr. Acme also has to add in Social Security taxes, unemployment compensation taxes, and worker's compensation premiums. In other words, your labor has to be productive enough to pay back not only your salary but also a host of taxes. Otherwise Mr. Acme simply cannot afford to hire you. What happens if government adds on another tax for insurance premiums? Obviously, workers will then cost even more to hire. In fact, some low-skilled workers will become too expensive to hire at all. Economists predict that if Congress imposes employer mandates, the food-service industry alone will lose up to 800,000 jobs. You may be a great pastry chef, but you won't be decorating cakes for Mr. Acme; instead you'll be garnishing your resume and hunting for another position. The irony is that many of the workers affected by employer mandates don't actually need health insurance: In many cases we're talking about teenagers working at McDonald's and covered by their parents' insurance, or wives earning a second income and covered by their spouse's insurance. But that doesn't matter: Employers will still be taxed for everyone they hire. So, ironically, even though these workers won't benefit from the new law, they'll pay the price in lost jobs. What about the workers who really do need health insurance? They won't benefit either—if they end up unemployed. No, the real solution is cheap, affordable health policies. The price of insurance has been driven up by state mandates that require people to pay for benefits they don't really need. Think of it this way: We don't force people to buy car insurance for every flat tire and broken spark plug. So why should we make them buy health coverage for things like chiropractors and acupuncturists? Real reform means replacing state-mandated benefits with no-frills policies that cover only real emergencies—policies that even most poor people can afford. As Christians, we may find the idea of a health-care bill appealing when it promises to cover the poor and uninsured. But remember that the most compassionate of plans can backfire. We should expose the fraud of bills that claim to offer health "security" but actually mean insecurity—by threatening people's jobs. Christians ought never embrace a plan that punishes the working poor. That is simply too high a price to pay.

07/21/94